Game makers' stock value tops shipbuilders'By Yoon Sung-wonThe market value of game companies here is growing at a rapid pace with their services recording better-than-expected sales performances both at home and abroad.

According to financial information provider FnGuide, the aggregate market capitalization of game and software firms here reached 39.99 trillion won ($36.69 billion) as of last week, which is more than a three-fold growth compared to 13.74 trillion won at the end of last year.

This is much greater than the aggregate market caps of the shipbuilding industry with 24.39 trillion won, the construction industry with 24.77 trillion won and the machinery industry with 18.1 trillion won.

NCSOFT is growing by about 84.04 percent year-on-year while Neptune and Wenzen have seen 108.56 percent and 87.29 percent growth rates in the KOSDAQ market.

Netmarble Games and Pearl Abyss, which made their initial public offerings in May and September, respectively, also performed well in their debut year. Netmarble opened at 157,000 won and is recording a 20.06 percent growth rate while Pearl Abyss is growing at 84.27 percent from its offering price of 103,000 won.More room for growthBehind such rapid growth of Korea's game industry this year are a series of favorable factors such as the launch of new titles scheduled from the end of this year and a move from political circles to scrap the so-called "forced game shutdown law."

NCSOFT plans to launch its megahit mobile game "Lineage M" in Taiwan on Dec. 11. Expectations are high over its success as the original computer online game "Lineage" established a huge fan base in the country. The mobile game has already attracted more than 2.5 million pre-orders so far.

Launched on June 21, "Lineage M" is creating a craze among Korean game users based on the support from those who used to play the original, which was launched in 1998. Thanks to such explosive popularity, NCSOFT generated over 550 billion won in sales from the mobile sector in the third quarter alone.

Pearl Abyss also plans to launch the mobile version of its computer online role-playing game "Black Desert" in Korea in January.

Despite its slow start in 2014, the original has attracted massive attention from overseas markets such as North America, Europe, Russia and Japan. The company said it seeks to roll out the mobile version globally as soon as possible.

Led by Rep. Kim Byung-kwan of the ruling Democratic Party of Korea, a group of lawmakers proposed a revision bill to scrap the "game shutdown law." It prohibits young people under 18 years old from accessing computer online games at nighttime.

As President Moon Jae-in has made positive remarks to support the game industry, it is likely that the revision bill will pass the National Assembly despite opposition.

Improving Sino-Korean relations are also a favorable for Korea's game industry.

Despite rapid growth of China's game market, Korean-made games were unable to debut in the country as the Chinese government has repeatedly refused to give permission as retaliation against Korea's deployment of the U.S. missile defense system.

Most Korean game companies including Netmarble Games, NCSOFT and Pearl Abyss are expected to gain benefits from the improving relations between the two companies.

On such a backdrop, foreign investors are increasingly pouring their money into Korean game firms. In the last two weeks, foreigners straight-purchased 200.9 billion won worth of NCSOFT shares and 86.1 billion won worth of Netmarble Games shares.

This trend is expected to continue as Korean game industry stocks are considered undervalued compared to those of foreign game firms. Netmarble Games' price-earnings ratio (PER) is expected to reach 14.5 times this year, followed by NCSOFT's 14.5 times and Pearl Abyss' 13.1 times. This is relatively lower than PERs of global game firms such as Nintendo with 38.6 times, Activision Blizzard with 31.1 times and EA with 29 times.